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Nielsen Suspends PRISM Data System

Blames Economy for Shutdown of In-store Measurement Service

BATAVIA, Ohio (AdAge.com) -- Nielsen is suspending its ambitious PRISM system for measuring audiences and gauging the effectiveness of in-store marketing, dealing a blow to efforts to put shopper marketing on a level analytical playing field with other media and marketing outlets.

In a statement, Nielsen blamed the indefinite suspension of the service, which began as a pilot in 2007, on the economy. The company began breaking the news to marketers and retailers involved in the project earlier today.

"Given the nation's serious economic state, Nielsen and its clients have decided this is not the right environment to launch a national syndicated service," the company said in the statement. "While the industry as a whole is very supportive of the syndicated service, many clients, in the face of the current economic environment, are not in a position to fully fund a syndicated service at this time."

Nielsen said it will keep providing custom work measuring and analyzing shopper marketing "until a syndicated service is financially viable for many of our clients."

No more Walmart
The move comes just over a month after Walmart Stores, an original backer of the effort and a charter member of the industry consortium of retailers and manufacturers behind it, said it wouldn't participate in the national rollout of PRISM or continue to waive its ban on sharing sales data with market-research firms as part of the project, as it had done since 2007.

At that time, AdAge.com reported that some in the industry, including one consortium member, predicted PRISM would go the way of another ambitious new system for measuring marketing impact, Apollo, which Arbitron and Nielsen shuttered last year after nearly four years of development and more than $45 million of investment.

As with Apollo, the cost of PRISM data, which an executive for a consortium member said ranges from the low to mid-six figures annually (and up to seven figures for bigger marketers), is particularly daunting in the current economy. While it pales in comparison with media or trade-promotion budgets, he said, PRISM's cost is huge for syndicated market research.

Marketers still a few steps back
The executive said PRISM also delves into a level of detail that is steps beyond what many marketers are still trying to accomplish in-store, such as simply ensuring trade funds actually get used for marketing and merchandising rather than pocketed by retailers or that programs get executed as designed. He also said he was concerned PRISM would result in more money shifting from media advertising to trade promotion, which could weaken brands to the benefit of retailers and private labels.

"It was interesting at first," the executive said. "But when you poke at it a little more, it gets a little less interesting."

But Mike Hess, director-global research and consumer insights for Omnicom Group's OMD, and also an agency member of the PRISM consortium board, called the suspension "disappointing, because it had so much potential." He said it will be difficult to restart the project once it's been shut down.

Besides giving in-store marketing an audience-measurement system akin to those for TV and radio, PRISM also had such added benefits as measuring "closure rates," or the proportion of shoppers exposed to marketing or merchandising in a store who actually bought products from a given category.

Despite the shutdown of PRISM, which was touted by Nielsen CEO Dave Calhoun as the best example of the company's efforts to break down silos and make Nielsen more than the sum of its parts, Mr. Hess said he sees progress from the company in meshing data from several of its databases in the Nielsen Connect program.

Major backing from P&G
PRISM, which stands for Pioneering Research for an In-Store Metric, also got major backing from Procter & Gamble Co. in an effort that began with the In-Store Marketing Institute.

In a speech to the Consumer Analyst Group of New York last February, P&G Chairman-CEO A.G. Lafley said PRISM "will transform how we think about in-store consumer communication and behavior" by showing what shoppers had the opportunity to see and which in-store programs work best.

"We are disappointed by Nielsen's announcement to suspend the launch of the service," P&G said in a statement. "P&G will continue to leverage the robust PRISM data from the [pilot] market work."

Peter Hoyt, executive director of the In-Store Marketing Institute, said: "I know it was very expensive to do the constant, continuous audits in the field. I think the cost would have come down over time, but they ran out of time to do that because so many of the original supporters are having to cut their budgets. ... It's a shame. We thought it had a lot of promise."

He added, "There will be another way found, and we'll continue to help do that."